Gold stocks have outperformed gold prices in 2014 to date, but don\’t expect that to last.

Part of the outperformance has come because gold companies were forced to aggressively cut costs as the price of gold slumped 28% in 2013, according to Citi\’s Global Gold Book. \”All the easy, short-term levers were pulled to make ends meet,\” Citi analysts led by Johann Steyn and Craig Irwin wrote in a note.

But despite these cost-cutting measures, Citi estimates that about 75% of the industry is still burning cash. \”The fact that gold companies tend to burn cash in good or bad markets to us accentuates the industry’s poor fundamentals,\” the analysts wrote.

That\’s building up to a return to outperformance of physical gold over gold stocks. Physical gold has trounced gold stocks 90% of the time in the past ten years, according to Citi research.

\”The odds are firmly against a gold company to deliver long-term shareholder value,\” they said.

Nouriel Roubini whipped out the \”b\” word on Thursday, telling Maria Bartiromo at Fox Business News that we\’re at the beginning of a credit bubble. We\’re not the brink of a major collapse, but we\’re getting there, he said.

The New York University professor and chairman of Roubini global economist is known as something as an economic pessimist, though he\’s become slightly more optimistic recently. Now the risks are shifting a bit further out into the future, he said.

Citigroup credit guru Matt King is on the lookout for a Wile E. Coyote moment in the markets. You know the one — where the beloved cartoon character races out over a cliff and hangs there midair until he realizes there\’s nothing to hold him up, at which point he plunges back to earth.

It\’s a potent — and scary — metaphor for central bank-infused capital markets, where there\’s certainly a fear that once monetary policy makers pull back from their dovish stances, markets will realize they were just hanging there with no fundamental economic strength to support them. With a slide in stocks last week, including a 3.1% drop in the Nasdaq
, fear is running high that more is in store.

Commodities have mostly outperformed other assets by a wide margin so far this year, analysts at Citi said on Tuesday. Of the roughly 27 active contract markets that Citi regularly tracks, nearly 20 commodities show increases in value in the first quarter to date, but not all are destined to continue their rise.

A bar graph provided by Citi shows that among the commodities, coffee
and lean hogs
have seen the biggest price increases so far this year, while West Texas Intermediate crude
has seen the least. Among the decliners, Brent crude
saw the least amount of percentage losses, while iron ore saw the most.

MarketWatch’s Sital Patel live-blogged Citigroup Inc. call with analysts, after the firm reported that its profit rose by 42% during the second quarter. Citi reported strength in its investment banking business and loan growth from emerging markets for the boost. Additionally, the firm continues to focus on cost-cutting. Read our coverage below.

9:45 am (EDT)

Sital

Thanks for joining. The investor call starts at 10 a.m. Eastern.

Citigroup's reported a second-quarter profit of $4.2 billion, up 42% from a year ago, driven by improved capital markets revenue and loan demand from emerging markets. Total net revenue was $20.5 billion, up from $18.64 billion in the prior year.

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